I do not profess to be an economist of any standing whatsoever but I do wonder at the rationale of the President of the IMF when she says that bank base rate should be reduced further from its present rate of 0.5%. With financial institutions lending to UK SMEs at around 15%-20%, it seems to me that base rate is all but redundant in the eyes of UK business owners and Mme Lagarde’s rate reduction will be of no benefit at all to the thousands of family-owned businesses which form the backbone of this country’s economy.
What will benefit our economy is encouragement for the developing SME, best exemplified by peeling back interference from petty little local government bureaucrats.
Let me tell you about my favourite little shop in Rugby. It is next to the station but on the wrong side of the tracks. It is sandwiched in between a derelict industrial building and the Post Office sorting centre. It used to sell nothing of any use and its opening times were unpredictable. Eventually, it closed.
My mate Garry is nothing if not an entrepreneur. He originally opened a car park in competition with Virgin Trains’ station car parks – all three of them. Eyeing the opportunity, he moved his car park to the derelict site and subsequently took a lease on the shop. One pays the parking fee in the shop which also provides real coffee to rival the high street café brands at only £2 (or £1 if you park on his car park), newspapers etc. Charging £5 a day as opposed to Virgin’s £4.50 or £3.50 off-peak, Garry’s car park is usually almost full. Why? Well, beyond the excellent coffee, his exuberant personality and manning until long after the last train has departed, his shop is now a wonderful place to meet people over a coffee. For the commuter he offers same day dry-cleaning, car valeting, car servicing including MoTs, all via other customers of his shop. Further available services include access to lawyers, architects, direct marketers, management consultants, financiers and provinders of all sorts. Who says people only buy on price? They look at the total offering.
The shop, rebranded Le Concierge for that is what it surely is to the busy commuter, is a hive of activity and a business success. What a shame the jobsworths at the local council have denied him permission to sell hot food such as bacon rolls…Because of a shortage of parking, apparently! You couldn’t invent it, could you?
Message to the Prime Minister…Get these idiots off the backs of successful small business. How about a little encouragement for my mate, Garry – and the thousands like him, for it is they who will lead Britain’s charge back to economic prosperity and not anyone employed by any level of government.